Corporate Withdrawal

THE MAIL

NO WRITER ATTRIBUTED
May 10, 1979

To The Editors of the Crimson:

The recent faculty debates on Harvard's relations with corporations that have investments in South Africa show that some basic facts are not generally appreciated. It seems useful to have these facts laid out so that they can be considered as members of the community mull over the situation during the summer months.

When one considers pressing corporations to withdraw from South Africa one should have a clear idea as to what that means. This problem was referred to by President Bok at the very close. Withdrawal means, in most cases, selling at a distress price to a Japanese or European firm whose attitude toward apartheid is apt to be worse, not better. The money thus realized must be invested for several years in South African government securities paying an interest rate about half that of the market. In other words, one must pay a ransom of some 40% of the sale price to the government that is the very cause of it all.

The ACSR has been wrestling with the problem of apartheid for nearly two years now and we are, it is true, only now getting to the point of knowing what to ask of the firms. Let us remember that our own Civil Rights Act of 1964 was preceded by years of intensive study on the part of the Civil Rights Commission and various congressional committees. Each of these bodies had far greater resources than we do and faced a problem that was simpler, if only by virtue of the fact that federal legislation can override law and behavior but Harvard's writ does not run in South Africa. Detley F. VagtsProfessor of Law